First Community Bankshares (FCBC) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $12.69 million ($0.71 per diluted share), up 29.26% year-over-year; six-month net income was $25.53 million ($1.42 per diluted share), up 18.22% from 2023.

• Net interest income decreased $950,000 year-over-year due to higher rates on interest-bearing deposits, but net interest margin rose to 4.51%.

• Noninterest income increased 6.34% year-over-year, while noninterest expense rose 0.92%, including a $1.8 million litigation settlement charge.

• Total assets as of June 30, 2024, were $3.23 billion; deposits decreased 1.65% and loans decreased 3.85% from year-end 2023.

• Declared a $0.31 per share quarterly dividend, marking 39 consecutive years of regular dividends.

Financial highlights

• Provision for credit losses dropped $3.96 million year-over-year, reflecting a smaller required provision and a decline in loan balances.

• Return on average assets was 1.58% for Q2 2024, up from 1.18% in Q2 2023; return on average common equity was 10.02%, up from 8.04%.

• Book value per share increased $0.65 since year-end 2023, reaching $27.85.

• Allowance for credit losses to total loans was 1.41% at June 30, 2024, unchanged from year-end.

• Adjusted diluted EPS for Q2 2024 was $0.79; adjusted ROA was 1.81%; adjusted ROE was 11.45%.

Outlook and guidance

• Management expects continued focus on credit quality, capital adequacy, and liquidity, with no material changes to risk factors since the last annual report.

• Forward-looking statements cite risks from market conditions, credit and interest rate management, expense control, regulatory changes, competition, and geopolitical events.

• Capital ratios remain well above regulatory minimums, and the company is classified as well-capitalized.